Rubio welcomes Panama’s move to exit Chinese infrastructure plan as ‘great step forward’
News comes after US secretary of state visited Panama to pressure the country over its ties with Beijing
US secretary of state Marco Rubio
has welcomed Panama’s decision to let its participation in China’s
global infrastructure plan expire, calling the move “a great step
forward” for its ties with the United States.
Any move by Panama to distance itself from Chinese President Xi Jinping’s signature Belt and Road Initiative
(BRI) represents a win for Washington, which has argued that Beijing
uses the scheme for “debt trap diplomacy” to cement its global
influence.
Rubio this week made his first overseas trip as the top US diplomat under Donald Trump to Panama, a close US partner in Latin America, and put pressure on the country over its ties with China.
After
talks with Rubio, Panama’s president José Raúl Mulino said his
country’s broad agreement to contribute to the Chinese initiative will
not be renewed, and could be terminated early. He said the deal was set
to expire in two to three years, but did not elaborate.
“Yesterday’s
announcement by President @JoseRaulMulino that Panama will allow its
participation in the CCP’s belt and road initiative to expire is a great
step forward for US-Panama relations, a free Panama Canal, and another
example of @POTUS leadership to protect our national security and
deliver prosperity for the American people,” Rubio posted on X after
departing the country.
Professor Yanzhong
Huang, a senior fellow at the New York-based Council on Foreign
Relations thinktank, said Panama’s “significant” decision to exit the
BRI showed an early win for the new Trump administration’s “brinkmanship
diplomacy”, but it wouldn’t necessarily be replicated easily.
“The
US now seems to be increasing its focus on its backyard, Latin America,
these countries that still need to rely on US support and trade,” Huang
said.
“But I’m not sure that the US could use
similar influence to force an Asian country, for example, to make
similar concessions. It’s unlikely given China is already the most influential actor in that region.”
China’s embassy in Washington did not respond immediately to a request for comment on the initiative or canal issues.
Panama
was the first Latin American country to officially endorse the BRI in
November 2017, five months after switching diplomatic ties from Taiwan
to China.
China rejects western criticism of
the initiative, saying more than 100 countries have joined it, and that
it has boosted global development with new ports, bridges, railways and
other projects.
Nonetheless, it has faced controversy, with some partner nations criticising the high cost of projects and struggling to repay loans. Italy withdrew from the initiative in 2023 amid US pressure over concerns about Beijing’s economic reach.
Such
US concerns have long extended to some Chinese companies’ operations
near the Panama Canal, including a Hong Kong-based firm operating two
ports, one at each end of the waterway that was built by the US in the
early 20th century and then handed over to Panama in 1999.
Two Chinese state-owned firms are separately building a fourth bridge over one of the canal’s entrances.
The
US state department said on Sunday that Rubio delivered a message from
Trump that China’s presence there was a threat to the canal and a
violation of the US-Panama treaty.
After talks
with Rubio, Mulino signalled a willingness to review the 25-year
concession to Hong Kong-based CK Hutchison Holdings, renewed in 2021 for
the operation of the two entrance ports, pending the results of an
audit.
The contract has been targeted by US
lawmakers and the government as an example of China’s expansion in
Panama, which they say goes against a neutrality treaty signed by both
countries in 1977.
Rubio, speaking to reporters
after landing in San Salvador on the next leg of his Latin American
trip, called Mulino a friend to the US, and Panama a strong partner and
ally. He said his visit had achieved “potentially really good things”.
“We don’t want to have a hostile or negative relationship with Panama,” Rubio said.
Ryan Berg, director of the Americas
Program at Washington’s Center for Strategic and International Studies,
said the audit could provide a way to unwind the concessions if it
shows the deals were marred by corruption.
“That
provides more legal framework for Panama to wiggle out of the
concessions and for Panama to reopen them such that an American company
or a European company might come in and win the bid,” Berg said.